EXEMPT
(Reprinted with amendments adopted on April 21, 2025)
FIRST REPRINT S.B. 402
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SENATE BILL NO. 402–SENATORS FLORES;
DOÑATE, STONE AND TAYLOR
MARCH 17, 2025
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JOINT SPONSORS: ASSEMBLYMEMBERS WATTS, DELONG;
DICKMAN, GRAY, GURR AND O’NEILL
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Referred to Committee on Government Affairs
SUMMARY—Provides for the creation of restoration improvement
districts for building restoration projects.
(BDR 22-332)
FISCAL NOTE: Effect on Local Government: May have Fiscal Impact.
Effect on the State: Yes.
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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
AN ACT relating to taxation; authorizing under certain
circumstances the governing body of a county or city to
create a restoration improvement district for the purpose
of a project to restore certain buildings that are at least 50
years of age; authorizing under certain circumstances the
governing body of a county or city to pledge certain
property tax proceeds for the costs of such a project;
establishing certain requirements for contracts or
agreements for construction work performed on such a
project; and providing other matters properly relating
thereto.
Legislative Counsel’s Digest:
This bill authorizes the governing body of a county or city in which a building 1
restoration project is or is expected to be located to create a restoration 2
improvement district that includes the project, or a part of the project, within its 3
boundaries. Section 3 of this bill defines the criteria for a project to qualify as a 4
building restoration project. Under section 7 of this bill, the governing body of a 5
county or city is authorized to: (1) adopt an ordinance creating a restoration 6
improvement district, subject to certain restrictions concerning the areas that may 7
be included in the district; and (2) pledge a portion of certain taxes on real property 8
collected in the district during a fiscal year, except that such a pledge may not 9
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include taxes on real property levied by or for the benefit of a public body if the 10
governing body of that public body elects, within a certain period, not to include 11
such taxes in the pledge. Section 8 of this bill provides that the amount of the 12
property taxes pledged is equal to the property tax revenue, excluding property tax 13
rate levied by a public body that has elected pursuant to section 7 not to include 14
such rates in the pledge and certain other property tax rates, collected in the district 15
in excess of the property tax revenue collected in the district before the creation of 16
the district. Sections 9 and 12 of this bill exclude a district created pursuant to 17
section 7 from certain limitations on the amount of revenue that a local government 18
is authorized to collect from property taxes. Section 10 of this bill provides that 19
such money would be pledged to the developer of the project for certain costs of the 20
project pursuant to an agreement entered into by the county or city in which the 21
project is located. Section 11 of this bill provides that work performed on a project 22
after the effective date of an ordinance creating a district, pursuant to a contract for 23
construction of the project, is subject to the prevailing wage requirements set forth 24
in existing law. Sections 3-6 of this bill define terms for the purposes of this bill, 25
and section 2 of this bill specifies the applicability of those definitions. 26
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. Title 22 of NRS is hereby amended by adding 1
thereto a new chapter to consist of the provisions set forth as 2
sections 2 to 11, inclusive, of this act. 3
Sec. 2. As used in this chapter, unless the context otherwise 4
requires, the words and terms defined in sections 3 to 6, inclusive, 5
of this act have the meanings ascribed to them in those sections. 6
Sec. 3. “Building restoration project” or “project” means a 7
project to improve, rehabilitate, repair, equip, maintain and 8
operate a building, and the site surrounding the building, if: 9
1. The building and the surrounding site are located, in 10
whole or in part, in the municipality creating a restoration 11
improvement district pursuant to section 7 of this act with respect 12
to the district; 13
2. The original structure of the building, excluding any 14
additions, is at least 50 years of age; 15
3. The owner of the building may hold a business license to 16
operate a business at the site of the building, whether or not the 17
owner holds such a license; 18
4. The building has not had any business operated at the site 19
for at least 10 years other than any operations necessary to 20
maintain a privileged license issued by a local government; and 21
5. As a result of the project, the building will be restored in a 22
manner consistent with the original character of the building. 23
Sec. 4. “Developer” means the person or entity that proposes 24
to undertake a building restoration project. 25
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Sec. 5. “District” means a restoration improvement district 1
created pursuant to section 7 of this act. 2
Sec. 6. “Municipality” means any county or city in this State. 3
Sec. 7. 1. Except as otherwise provided in this section, the 4
governing body of a municipality may: 5
(a) Create a restoration improvement district for the purposes 6
of carrying out this chapter by adopting an ordinance describing 7
the boundaries of the district, which must be the geographic 8
boundaries of a building restoration project in the municipality, 9
and generally describing the purposes within the district for which 10
money pledged pursuant to this chapter may be used. An 11
ordinance adopted pursuant to this paragraph must include the 12
findings of the governing body of the municipality that the project 13
qualifies as a building restoration project. 14
(b) For the purposes of carrying out paragraph (a), include in 15
an ordinance adopted pursuant to that paragraph the pledge of the 16
proceeds of any taxes levied for a fiscal year upon taxable real 17
property in the district each year by or for the benefit of the State, 18
the municipality and any public body, in the amount determined 19
pursuant to paragraph (b) of subsection 1 of section 8 of this act. 20
2. Upon introduction of an ordinance to create a restoration 21
improvement district pursuant to paragraph (a) of subsection 1, 22
the governing body of the municipality shall provide notice of the 23
introduction of the ordinance to the governing body of each public 24
body, other than the State, by or for the benefit of which any tax is 25
levied upon taxable real property in the district. Not later than 30 26
days after the receipt of such notice, the governing body of a 27
public body receiving such a notice may: 28
(a) Provide comments to the governing body of the 29
municipality introducing the ordinance concerning the creation of 30
the restoration improvement district; and 31
(b) Adopt a resolution to elect not to include any taxes levied 32
by or for the benefit of the public body in the pledge of the 33
proceeds of taxes levied upon taxable real property in the district, 34
which is proposed to be included in an ordinance adopted 35
pursuant to paragraph (a) of subsection 1. If, within 30 days after 36
receiving notice pursuant to this subsection the governing body of 37
a public body adopts such a resolution, the governing body must 38
send, by certified mail, notice of the adoption of the resolution to 39
the governing body of the municipality that introduced the 40
ordinance and the governing body of that municipality may not 41
include in the ordinance a pledge of any taxes levied for a fiscal 42
year upon taxable real property in the district each year by or for 43
the benefit of that public body. 44
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3. The governing body of a municipality shall not adopt an 1
ordinance pursuant to this section or create a restoration 2
improvement district for any building restoration project unless 3
the municipality has entered into a written deed restriction or 4
restrictive covenant with the developer of the project, and such 5
deed restriction or restrictive covenant has been properly and 6
validly recorded with the appropriate county recorder in the 7
county where the building restoration project is located. The 8
recorded deed restriction or restrictive covenant must restrict the 9
use of the building restoration project or any portion of the 10
building restoration project as follows: 11
(a) The written deed restriction or restrictive covenant must 12
include the developer of the building restoration project and the 13
municipality as parties to the document. 14
(b) The written deed restriction or restrictive covenant must 15
prohibit the building restoration project or any portion of the 16
building restoration project from conducting or operating a 17
nonrestricted operation, as defined in NRS 463.0177, on all or any 18
portion of the building restoration project that requires or would 19
require a nonrestricted license, as defined in NRS 463.0177, for a 20
period of at least 20 years from the date of the ordinance or the 21
creation of the district, whichever date is later. 22
(c) The written deed restriction or restrictive covenant shall be 23
a covenant running with the land for the benefit of the 24
municipality and shall be binding on the successors and assigns of 25
the building restoration project and the municipality. 26
(d) No party to the written deed restriction or restrictive 27
covenant shall alter, amend, revoke or terminate the deed 28
restriction or restrictive covenant for a period of at least 20 29
continuous years after the adoption of the ordinance or creation of 30
the district, whichever date is later. After that time period, any 31
alteration, amendment, revocation or termination of the deed 32
restriction or restrictive covenant shall require the affirmative vote 33
of the governing body of the municipality creating the district. 34
4. A restoration improvement district may not include any 35
property that is, at the time the boundaries of the restoration 36
improvement district are created, included within a redevelopment 37
area previously established pursuant to the laws of this State. 38
5. A restoration improvement district may not include any 39
parcel or parcels of land, building or group of buildings or spaces 40
that include or will include an establishment, as defined in NRS 41
463.0148, that holds a nonrestricted gaming license, as defined in 42
NRS 463.0177, whether the license is held by the owner, lessor or 43
lessee of the building restoration project or a third party licensed 44
by the Nevada Gaming Commission to operate gaming devices, as 45
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defined in NRS 463.0155, or games as defined NRS 463.0152, on 1
a continuous or periodic basis. 2
6. A district created pursuant to this section by: 3
(a) A city must be located entirely within the boundaries of 4
that city. 5
(b) A county must be located entirely within the boundaries of 6
that county and, when the district is created, entirely outside of the 7
boundaries of any city. 8
Sec. 8. 1. After the effective date of an ordinance adopted 9
pursuant to section 7 of this act, any taxes levied upon the taxable 10
real property in the district each year by or for the benefit of the 11
State, the municipality and any public body must be divided as 12
follows: 13
(a) That portion of the taxes that would be produced by the 14
rate upon which the tax is levied each year by or for each of those 15
taxing agencies upon the total sum of the assessed value of the 16
taxable real property in the district as shown upon the last 17
equalized assessment roll used in connection with the taxation of 18
the real property by the taxing agency, must be allocated to and 19
when collected must be paid into the funds of the respective taxing 20
agencies as taxes by or for the taxing agencies on all other real 21
property are paid. 22
(b) Except as otherwise provided in this section, the portion of 23
the taxes levied on taxable real property each year in excess of the 24
amount determined pursuant to paragraph (a) must be allocated 25
to, and when collected must be paid into, the restoration 26
improvement district account pertaining to the project to pay 27
money pledged pursuant to paragraph (b) of subsection 1 of 28
section 7 of this act. Unless the total assessed valuation of the 29
taxable real property in the restoration improvement district 30
exceeds the total assessed value of the taxable real property in the 31
district as shown by the last equalized assessment roll referred to 32
in this subsection, all of the taxes levied and collected upon the 33
taxable real property in the district must be paid into the funds of 34
the respective taxing agencies. When all payments required by any 35
agreement entered into pursuant to section 10 of this act have 36
been paid, all money thereafter received from taxes upon the 37
taxable real property in the restoration improvement district must 38
be paid into the funds of the respective taxing agencies as taxes on 39
all other real property are paid. 40
2. The portion of the taxes levied each year in excess of the 41
amount determined pursuant to paragraph (a) of subsection 1 42
which is attributable to any tax rate levied by a taxing agency: 43
(a) To produce revenue in an amount sufficient to make 44
annual repayments of the principal of, and the interest on, any 45
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bonded indebtedness that was approved by a majority of the 1
registered voters within the area of the taxing agency voting upon 2
the question, must be allocated to, and when collected must be 3
paid into, the debt service fund of that taxing agency. 4
(b) In excess of any tax rate of that taxing agency applicable to 5
the last taxation of the real property before the effective date of the 6
ordinance, if that additional rate was approved by a majority of the 7
registered voters within the area of the taxing agency voting upon 8
the question, must be allocated to, and when collected must be 9
paid into, the appropriate fund of that taxing agency. 10
(c) Pursuant to NRS 387.3285 or 387.3287, if that rate was 11
approved by a majority of the registered voters within the area of 12
the taxing agency voting upon the question, must be allocated to, 13
and when collected must be paid into, the appropriate fund of that 14
taxing agency. 15
(d) For the support of the public schools within a county 16
school district pursuant to NRS 387.195, must be allocated to, and 17
when collected must be paid into, the State Education Fund. 18
(e) For which the governing body of the taxing agency has 19
adopted a resolution pursuant to paragraph (b) of subsection 2 of 20
section 7 of this act electing not to pledge the taxes levied by the 21
taxing agency, must be allocated to, and when collected must be 22
paid into, the appropriate fund of that taxing agency. 23
3. The provisions of paragraph (a) of subsection 2 include, 24
without limitation, a tax rate approved for bonds of a county 25
school district issued pursuant to NRS 350.020, including, without 26
limitation, amounts necessary for a reserve account in the debt 27
service fund. 28
4. As used in this section, the term “last equalized assessment 29
roll” means the assessment roll in existence on the 15th day of 30
March immediately preceding the effective date of the ordinance. 31
Sec. 9. The allowed revenue from taxes ad valorem 32
determined pursuant to NRS 354.59811 does not apply to a district 33
created pursuant to this chapter. 34
Sec. 10. 1. Except as otherwise provided in this section, if 35
the governing body of a municipality adopts an ordinance 36
pursuant to section 7 of this act, the municipality may enter into 37
an agreement with the developer of the building restoration 38
project for the cost of improving, rehabilitating, repairing, 39
equipping, maintaining or operating, or any combination thereof, 40
the project, which may contain such terms as are determined to be 41
desirable by the governing body of the municipality, including the 42
payment of reasonable interest and other financing costs for the 43
project. Any such reimbursements may be secured by a pledge of, 44
and be payable from, any money pledged pursuant to section 7 of 45
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this act and received with respect to the district. If such an 1
agreement is entered into, the agreement must provide for an 2
annual payment to the developer of the money pledged pursuant to 3
section 7 of this act and received by the municipality not later than 4
15 days after the date for such an annual payment specified in the 5
agreement. An agreement entered into pursuant to this section is 6
not subject to the limitations of subsection 1 of NRS 354.626 and 7
may, at the option of the governing body, be binding on the 8
municipality beyond the fiscal year in which it was made, only if 9
the agreement pertains solely to the project. 10
2. No agreement entered into pursuant to this section may be 11
secured by or payable from the general fund of the municipality, 12
the power of the municipality to levy ad valorem property taxes, or 13
any source other than any money pledged pursuant to section 7 of 14
this act and received by the municipality with respect to the 15
district, or any combination thereof. No agreement entered into 16
pursuant to this section may ever become a general obligation of 17
the municipality or a charge against its general credit or taxing 18
powers, nor may any such agreement become a debt of the 19
municipality for purposes of any limitation on indebtedness. 20
3. Any agreement entered pursuant to this section 21
automatically terminates at the end of the fiscal year in which the 22
20th anniversary of the adoption of the ordinance creating the 23
district occurs. 24
Sec. 11. The provisions of NRS 338.013 to 338.090, 25
inclusive, apply to any construction work related to a building 26
restoration project performed after the effective date of an 27
ordinance creating a district adopted pursuant to section 7 of this 28
act with respect to the project, under a contract awarded or an 29
agreement entered into with respect to the project, whether or not 30
the contract was awarded or the agreement was entered into on or 31
after the effective date of that ordinance. If, pursuant to this 32
subsection, the provisions of NRS 338.013 to 338.090, inclusive, 33
are applicable, the governing body, the developer, any contractor 34
who is awarded such a contract or enters into such an agreement 35
to perform the construction work and any subcontractor who 36
performs any portion of the construction work related to such a 37
project shall comply with the provisions of NRS 338.013 to 38
338.090, inclusive, in the same manner as if the governing body 39
had undertaken the project or had awarded the contract. 40
Sec. 12. NRS 354.59811 is hereby amended to read as 41
follows: 42
354.59811 1. Except as otherwise provided in NRS 244.377, 43
278C.260, 354.59813, 354.59815, 354.59818, 354.5982, 354.5987, 44
354.705, 354.723, 450.425, 450.760, 540A.265 and 543.600, and 45
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section 9 of this act, for each fiscal year beginning on or after 1
July 1, 1989, the maximum amount of money that a local 2
government, except a school district, a district to provide a 3
telephone number for emergencies or a redevelopment agency, may 4
receive from taxes ad valorem, other than those attributable to the 5
net proceeds of minerals or those levied for the payment of bonded 6
indebtedness and interest thereon incurred as general long-term debt 7
of the issuer, or for the payment of obligations issued to pay the cost 8
of a water project pursuant to NRS 349.950, or for the payment of 9
obligations under a capital lease executed before April 30, 1981, 10
must be calculated as follows: 11
(a) The rate must be set so that when applied to the current fiscal 12
year’s assessed valuation of all property which was on the preceding 13
fiscal year’s assessment roll, together with the assessed valuation of 14
property on the central assessment roll which was allocated to the 15
local government, but excluding any assessed valuation attributable 16
to the net proceeds of minerals, assessed valuation attributable to a 17
redevelopment area and assessed valuation of a fire protection 18
district attributable to real property which is transferred from private 19
ownership to public ownership for the purpose of conservation, it 20
will produce 106 percent of the maximum revenue allowable from 21
taxes ad valorem for the preceding fiscal year, except that the rate so 22
determined must not be less than the rate allowed for the previous 23
fiscal year, except for any decrease attributable to the imposition of 24
a tax pursuant to NRS 354.59813 in the previous year. 25
(b) This rate must then be applied to the total assessed valuation, 26
excluding the assessed valuation attributable to the net proceeds of 27
minerals and the assessed valuation of a fire protection district 28
attributable to real property which is transferred from private 29
ownership to public ownership for the purpose of conservation, but 30
including new real property, possessory interests and mobile homes, 31
for the current fiscal year to determine the allowed revenue from 32
taxes ad valorem for the local government. 33
2. As used in this section, “general long-term debt” does not 34
include debt created for medium-term obligations pursuant to NRS 35
350.087 to 350.095, inclusive. 36
Sec. 13. This act becomes effective upon passage and 37
approval. 38
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